One of Ireland’s formerly biggest property companies, Treasury Holdings faces its fate this afternoon – from 12 midday, in Dublin’s High Court – as Belgian bank KBC resumes its bid to have Treasury wound up. Yesterday, Treasury told the court that KBC had an ulterior motive in pursuing the winding up petition at this juncture, and that ulterior motive was to assist NAMA. Last month, NAMA defeated Treasury’s legal bid to overturn the decision by NAMA to foreclose on Treasury’s loans to the Agency. At the time, Treasury said it would appeal the decision to the Supreme Court, but if a winding up order is granted now to KBC, then the current owners of Treasury, Johnny Ronan and Richard Barrett will lose control of their company, and the appeal against NAMA may be abandoned. At least, this is what is being alleged by Treasury.
For its part yesterday, KBC said it was pursuing the repayment of its portion of a €270m loan advanced to Treasury and 15 companies within the Treasury group, all for the redevelopment of the Spencer Dock area of central Dublin – a slice of land on the north side of the Liffey which includes the National Convention Centre. KBC was seemingly highly dismissive of Treasury’s latest White Knight, Morgan Stanley which Treasury said offered the potential to invest in the company. Morgan Stanley is but the latest in a loooong line of investors to have an initial dalliance with Treasury, but didn’t progress into anything serious. US investor CIM, and separately US investor Hines and Aussie investor Macquarie all courted Treasury in the past 18 months, but their offers were ultimately rejected by NAMA. KBC said it was rejecting the Morgan Stanley offer as it did “not make commercial sense to the bank and had been refused”
Treasury is seeking an adjournment of the winding up petition. According to the Irish Independent, KBC complained to the court that “request for an adjournment of the petition [by Treasury] was “simply asking the court to allow Treasury trade while wholly insolvent.””
Treasury concedes it is insolvent, but claims that 300 Irish jobs are at stake if the group is wound up. The “300” figure seems to include Treasury’s assessment of externally related jobs in Ireland that would be at risk – Treasury told the High Court in the NAMA judicial review case, which it lost, that the company employed just 45 people in Ireland.
The case resumes at 12 midday today, and it is hard to see it continuing much longer.
UPDATE (1): 28th August, 2012. RTE’s sure-footed Legal Correspondent, Orla O’Donnell will be attending the hearing from 12 midday, and hopefully she might tweet any significant development. You can follow Orla on Twitter here.
UPDATE (2): 28th August, 2012. RTE is reporting the recent transfer of two companies hitherto associated with Treasury China’s operations have been transferred to a Jersey-based company called “Oriental Management Services” which RTE says is beneficially owned by Treasury co-founder, Richard Barrett. It seems that NAMA is not happy with some recent transfers, understood to be these two which RTE is reporting, and has now weighed in behind KBC in supporting the bid to have Treasury Holdings wound up.
UPDATE (3): 28th August, 2012. The hearing has concluded for the time being, and the matter has been adjourned until 9th October, 2012 by the judge, Mr Justice Brian McGovern with several orders including, according to RTE, the production of “a sworn documents outlining the terms and circumstances of a transfer of the assets of a Treasury subsidiary in Singapore to a company beneficially owned by a director of Treasury, Richard Barrett.” and that there be “no disposition by any companies in the group of their shares before 9 October”. According to RTE, the judge saw no prejudice to KBC’s rights from the 6-week adjournment and also said the matter would not be adjourned further, but would be decided on 9th October.
UPDATE: 31st August, 2012. According to the Irish Independent today, the two companies sold to Richard Barrett were Treasury Holdings Real Estate PTE and Treasury Holdings (Shanghai) Property Co Limited and that Richard Barrett paid €2.236m for the two companies. Richard is reported to have told the Independent that NAMA “knew the deal was on the cards well in advance” and as for the €2.236m purchase price “It was the higher of two independent valuations obtained from accountancy firms, he said. The accountants cannot be identified because of confidentiality agreements, but neither is Treasury’s own auditor, he said.”